Belarusian refinery starts charging penalties for short supply of on-spec oil from Russia

May 14/ 13:12

Minsk. Naftan has started charging penalties from Russian suppliers due to the short supply of marketable oil in April, Deputy CEO of the Belarusian refinery Sergei Altukhov told reporters on Tuesday, as BelTA Agency reports.

"The legal function of the company organized work on charging penalties in respect of Russian suppliers due to short supply of on-spec oil in April," the top-manager said.

Costs related to performance decline of the refinery are currently estimated. The overall package of claims will be prepared after conclusion of this process and claim handling will continue, Altukhov added.

The refinery had to reduce its refining throughput by half at the turn of April due to deliveries of off-spec oil over the Druzhba oil pipeline, the top manager said. The company continues working with such capacity utilization and refines oil delivered over the Surgut-Polotsk pipeline, Altukhov noted. "Oil has proper quality, making it possible to use it without concerns regarding equipment operability," he noted.

On April 19, Belarusian concern Belneftekhim reported a sharp deterioration of the quality of the Russian oil running through the Druzhba oil pipeline and subsequently informed pipeline operators from other countries about the situation. The content of organochloride compounds in oil was dozens of times above the limit value, the company said.

Two Belarusian refineries, the Mozyr Refinery and Naftan, had to reduce capacity utilization and sustained losses. Deliveries of oil to Naftan over the Surgut-Polotsk oil pipeline started according to arrangements.

The Russian oil compliant with the technical regulations reached the border with Belarus on May 2 and the Mozyr line operations control stations on May 4, told TASS.

The Druzhba oil pipeline system supports oil deliveries to Belarusian refineries and oil transit to Europe via Belarus in two directions, through Poland and Ukraine.